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Retail

Migros Sees Boost From Organic Product Sales Despite 'Challenging' Year

By Steve Wynne-Jones
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Migros Sees Boost From Organic Product Sales Despite 'Challenging' Year

Switzerland's Migros Group recorded more than CHF 1 billion (€940 million) worth of organic product sales for the first time in 2019, despite the overall business seeing profits decline in what it described as a 'challenging' financial year.

The retailer said that sales of eco-friendly products, as well as those with a social added-value, totalled CHF 3,148 billion (+ 0.6%), as the group continues to invest more in sustainable and ethical products.

Sales Performance

Consolidated sales across the Migros Group totalled CHF 28.6 billion (€27 billion) last year, with group profits dropping 29.6% to CHF 335 million, due to one-off losses resulting from the divestment of the Gries Deco Group and m-way.

Operating profit before portfolio adjustment was up 5.5% to CHF 686 million, it added, as a result of newly-implemented measures along its value chain.

'The process of adjusting the portfolio in the non-food area was successfully completed within a few months with the sale of the Gries Deco Group, the branches of Interio, m-way and Globus,' the group said in a statement.

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'Thanks to the sale of these divisions, Migros can invest more selectively where this benefits customers better.'

Online Growth

The year 2019 saw Migros maintain its position as the market leading in Swiss online retail, with online sales growing by 9.8% to CHF 2,285 billion.

Elsewhere, its Digitec Galaxus online retail platform saw sales rise by 16.1% to CHF 1,106 billion.

Embracing Sustainability

In 2019, Migros implemented a new climate and energy strategy, in line with the Paris Climate Agreement, through which it reduced the amount of goods transported by plane by almost 10% compared to the previous year.

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It also unveiled six new sustainability projects, in the areas of energy-efficient heating systems, employee mobility, photovoltaics and electromobility, and increased its reliance on rail transport for freight goods.

On the packaging front, it reduced the packaging of some 54 products, saving more than 5,000 tonnes of material, and unveiled a number of 'unpacked' fruit and vegetable lines to its stores.

Commenting on the group's future strategy, Jörg Zulauf, head of finance, said that Migros is "strategically focusing on its core business, is investing in the future of the company and has a very solid equity base".

© 2020 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.

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